DP628 The Political Economy of Transition in the Soviet Union

Author(s): Gérard Roland
Publication Date: January 1992
Keyword(s): Political Economy, Soviet Union, Transition
JEL(s): 052, 124
Programme Areas: International Macroeconomics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=628

This paper analyses the political economy of transition in the Soviet Union since Perestroika. It is argued that no major sequencing errors were made and that important steps were taken in the direction of democratization and the introduction of a private sector. Gorbachev's major error can be attributed to the macro mismanagement from 1985 onwards, leading to a loss of a central control and to the disintegration of the Soviet Union, unleashing nationalist forces and necessitating an increase in the speed of economic transition, in a situation where the political conditions for further reform had not yet been met. After the disintegration of the Union, stalemate between republics over the sharing of the costs of transition and stabilization delays the adoption of necessary economic measures.